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Hello everyone, I have some questions regarding USDA loans and our ability to get one. First what is it? is it like FHA loans?
My partner and I are looking into buying a house, a few of which are USDA eligible. we have a combined income of roughly $58k, which according to the USDA website , puts us above the low income bracket ($46k) but below the moderate income loan limit. ($81k) He has a credit score in the 650-660 range, and mine is in the 750's. The only real debt we have is 2 car loans ($580/month combined) and maybe another $75 in minimum credit card payments, but we'd probably just pay those off before seeing the bank.
What are the credit, and debt to income requirements for USDA, how about percent for down payment?
The USDA looks like a good deal, but I don't know if I should just wait and get an FHA loan.
When talking to someone about these loans, there are two kinds of USDA loans: direct and guaranteed. Guaranteed is what a local lender can help with and is for low to moderate income. Direct is only handled only by USDA offices, is a lower rate and for low income buyers. No local loan officers can help with direct.
My sister just did a USDA in December and got a crazy good rate, 2.85% which for no credit and moderate income (roughly 45k IIRC combined) was pretty durn good. The PMI was lower at that time as well.
Hello everyone, I have some questions regarding USDA loans and our ability to get one. First what is it? is it like FHA loans?
My partner and I are looking into buying a house, a few of which are USDA eligible. we have a combined income of roughly $58k, which according to the USDA website , puts us above the low income bracket ($46k) but below the moderate income loan limit. ($81k) He has a credit score in the 650-660 range, and mine is in the 750's. The only real debt we have is 2 car loans ($580/month combined) and maybe another $75 in minimum credit card payments, but we'd probably just pay those off before seeing the bank.
What are the credit, and debt to income requirements for USDA, how about percent for down payment?
The USDA looks like a good deal, but I don't know if I should just wait and get an FHA loan.
Thanks for reading
Go with USDA if you can. Your monthly Mortgage Insurance will be half of what FHA charges, and if you can negotiate seller-paid closing costs, your out-of-pocket can literally be zero. (Yes, inspection and appraisal must be paid up front, but I had a few wherein we actually got the appraisal fee refunded because the seller concession covered everything)
USDA= zero down payment, fha = 3.5%.
Interest rates are pretty much identical, at least that's what I'm seeing, your mileage may vary.
Go with USDA if you can. Your monthly Mortgage Insurance will be half of what FHA charges, and if you can negotiate seller-paid closing costs, your out-of-pocket can literally be zero. (Yes, inspection and appraisal must be paid up front, but I had a few wherein we actually got the appraisal fee refunded because the seller concession covered everything)
USDA= zero down payment, fha = 3.5%.
Interest rates are pretty much identical, at least that's what I'm seeing, your mileage may vary.
Thanks for the info. I wasn't even thinking about USDA until I saw some listings had "USDA Eligible" written in. Seems like a good deal for those moderate income families. I was looking into mortgage brokers in my area (something else I never heard of until someone here mentioned it), are they better to go through than going to my local credit union?
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